ALPHA, IL - AUGUST 17: U.S. President Barack Obama speaks at a town hall style meeting at Country Corner Farm Market on August 17, 2011 in Alpha, Illinois. President Obama is on the last day of a three-day bus tour of Minnesota, Iowa and Illinois during which he will discuss ways to improve the economy and create jobs, and hear directly from Americans. (Photo by Joe Raedle/Getty Images)

The president says he'll propose a jobs bill shortly after Labor Day. Will it do any good? That depends on how bold it is.

All he's talked about so far is extending the payroll tax cut and unemployment benefits (fine, but small potatoes), ratifying the Colombia and South Korea free trade agreements (not necessarily a job-creating move) and reauthorizing the highway-building fund (a necessary but tiny step).

Some of the president's political advisers are pushing these sorts of small-bore initiatives. They think these might have a chance of getting through the Republican "just say no" House. They also figure such policy miniatures won't give aspiring GOP candidates more ammunition to tar Obama as a big-government liberal.

But the president should reject their advice and come up with a jobs bill that's large enough to make a difference. Boldness on the jobs front is good policy and good politics.

Good policy because the economy needs a major boost to get out of the gravitational pull of the Great Recession. Right now all the old booster rockets are gone. The original stimulus is over. The Fed's "quantitative easing" is over. State and local governments continue to slice their budgets.

A bold jobs plan is also good politics. To be re-elected, the president has to come out fighting on the side of average people. The jobs and wages depression that started in 2008 continues. More than 25 million Americans are looking for full-time jobs, and median wages continue to drop. Americans want a president who's visibly on their side.

Besides, Republicans won't go along with any jobs initiative the president proposes - even a tiny one. Better they reject one that could make a real difference than one that's pitifully small and symbolic.

If Republicans reject it, Obama can build his 2012 campaign around that fight. Maybe he'll even call Republicans on their big lie that smaller government leads to more jobs.

What would a bold jobs bill look like? Here are the 10 components I'd recommend:

1. Exempt the first $20,000 of income from payroll taxes for two years. Make up the shortfall by raising the ceiling on income subject to payroll taxes.

2. Re-create the WPA and Civilian Conservation Corps to put the long-term unemployed directly to work.

3. Create an infrastructure bank authorized to borrow $300 billion a year to repair and upgrade the nation's roads, bridges, ports, airports, school buildings, and water and sewer systems.

4. Amend bankruptcy laws to allow distressed homeowners to declare bankruptcy on their primary residence, so they can reorganize their mortgage loans.

5. Allow distressed homeowners to sell a portion of their mortgages to the FHA, which would take a proportionate share of any upside gains when the homes are sold.

6. Provide tax incentives to employers who create net new jobs (a $2,500 deduction for every net new job created).

7. Make low-interest loans to cash-starved states and cities, so they don't have to lay off teachers, firefighters and police officers, and reduce other critical public services.

8. Provide partial unemployment benefits to people who have lost part-time jobs.

9. Enlarge and expand the Earned Income Tax Credit - a wage subsidy for low-wage work.

10. Impose a "severance fee" on any large business that lays off an American worker and outsources the job abroad.

Some of these won't cost the federal government anything. Others will be costly in the short term but lead to faster growth.

Remember: Faster growth means a more manageable debt in the long term. That means the president could tie this (or any other jobs bill of similar magnitude) to an even more ambitious long-term debt-reduction plan than he's already proposed.

A strong jobs bill is good politics and good policy. But will the president be bold? We'll find out soon.

Robert Reich, former U.S. secretary of labor, is professor of public policy at UC Berkeley and the author of "Aftershock: The Next Economy and America's Future." He blogs at www.robertreich.org. To comment, go to sfgate.com/chronicle/submissions/#1.